It might not be the most interesting finding in MasterCard’s May SpendingPulse report, but the fact that, despite a slight decline in discretionary spending, the overall trend in spending in restaurants and for jewelry remains extremely strong certainly is the most important, according to Sarah Quinlan, senior vice president for market insights at MasterCard Advisors.
In discussing the findings from the May report with Market Platform Dynamics CEO Karen Webster, Quinlan acknowledged that consumers’ views on their ability to spend are on the rise.
(Jump to: 0:50) “The consumer is having the confidence to continue to spend, and that really has been reflected, of course, in labor statistics and other statistics, and consumer confidence-numbers themselves,” she said. “We’re continuing to see that onward trend that we frankly saw begin last October, when we saw a drop in the price of gasoline year over year, which was really a catalyst to get discretionary spending going in the U.S.”
Quinlan also noted the significance of the continued double-digit rise in online spending. The fact that the base continues to grow at the same time shows that more consumers feel confident shopping from their PCs, tablets and smartphones, and they also, surprisingly, are doing so to shop for apparel and from department stores online, she said.
However, the growth in online spending dipped a bit in May, driven by improving weather, Quinlan said. Indeed, shopping is a social activity, and consumers will continue to want to shop with family and friends when the weather improves, she said.
As for the overall impact of online versus offline shopping, Quinlan noted that half of consumer electronics today are purchased online because it’s considered a “commodity business” that’s driven more on price and the convenience of purchasing online. However, buying apparel online also has grown, she said.
(Jump to: 4:28) “Apparel has gotten very, very strong. Interesting enough, we’re also seeing strength in department stores, which really was a differentiator because we don’t actually like to shop in bricks and mortar and department stores, but we very much like the experience online,” she said. “So there’s a big delineation.”
What that also shows is that merchants must move to capture consumers’ interest in all aspects of the shopping experience, and make it possible for them to browse and pay where they prefer. (Jump to: 4:45) “The retailer must have that seamless omnichannel experience for their clientele because their client wants to shop when and where they want to shop, at the time they want to shop, and in any way and in any form,” Quinlan said. “And that includes mobile as well.”
But not enough merchants yet have made it possible so their customers can see and touch things in any way they want when shopping, be it online or in stores. (Jump to: 5:38) “That’s the big thing we’re really trying to move people forward – to understanding that’s how the consumer … is wanting their experience to be,” Quinlan said.
To hear more about Quinlan’s views on consumer-spending trends, click here.
*If you have trouble with the audio player above, click here.